Data from Kooistra Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,270 and the cost of goods sold was $770.
-The average sale period for Year 2 is closest to:
A)51.7 days
B)221.3 days
C)78.2 days
D)85.3 days

Question

Data from Kooistra Corporation's most recent balance sheet appear below:  Sales on account in Year 2 amounted to $1,270 and the cost of goods sold was $770.
-The average sale period for Year 2 is closest to:
A)51.7 days 
B)221.3 days 
C)78.2 days 
D)85.3 days

Quizplus · Accepted Answer

Inventory turnover = Cost of goods sold F1F1F1S1F1F1F10 Average inventory balance
= $770 F1F1F1S1F1F1F10 $165* = 4.67
*Average inventory balance = ($180 + $150)F1F1F1S1F1F1F10 2 = $165
Average sale period = 365 days F1F1F1S1F1F1F10 Inventory turnover
= 365 days F1F1F1S1F1F1F10 4.67 = 78.2 days

Data from Kooistra Corporation's Most Recent Balance Sheet Appear Below